Saturday, July 20, 2013

An era of big art sales

Art Basel, the most significant brand in the realm of art fairs, got an early start with Art Basel Hong Kong this year. It was, in fact, the first time the fair has exhibited in this part of the world, and its third location following Basel and Miami. Some felt that another edition might lead to ‘fair fatigue’.

Art Basel HK just might have had an opposite, albeit positive effect, priming curious collectors for the bigger Basel extravaganza. Of close to 250 galleries that were present, more than half came from Asia, indicating Art Basel actually broadened its footprint by encompassing new galleries to it that cater especially to Asian collectors, who often prefer works of domestic artists.

While currency meltdowns or stock market dips affect art sales rarely in the shorter term, schism in the wealth gap have been found to track them. As ultra-HNIs (high net worth individuals) become wealthier, prices of art soar higher, as more money tends to chase a finite supply of works by top artists. The rising global divide between ultra-high net worth individuals and the rest is probably the best indicator that contemporary art prices will continue to inch up in 2013.

There’s a general tendency toward herd behavior noticed among the ultra-wealthy not averse spending six, seven, or even eight figures on art. Right now this herd is lurching toward contemporary art, explains Boyle. Brett Gorvy, international chairman (post-war & contemporary art) at Christie’s, called their record-breaking sales in May ‘a new era in the art market.” There’s no doubt contemporary art is fast becoming the most important alternative asset class. The trend of big sales continued with Art Basel.

Contemporary sales, it appears, are not the only ones setting new records. The auctioneer at Sotheby’s, Mary Jo Otsea estimated to sell the famed ‘Clark Sickle-Leaf Carpet’ for somewhere around $10 million to $15 million. At a time of extreme volatility in global stock markets and weak returns on bonds, there is ample evidence of the healthy demand for art among the ‘ultra-wealthy alternative asset classes’. That can only mean more good news for the contemporary art scene.

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